The British Columbia government introduced Bill 13 – 2023 Pay Transparency Act (the “Act”) for first reading on March 7, 2023. The Act quickly made its way through the legislative process became law on May 11, 2023.
British Columbia’s New Legislation Aimed to Help Close the Gender Wage Gap
The Act is designed to address the gender pay gap – that is, the difference in average earnings between people based on their gender. While the gender pay gap affects people all along the gender continuum, it is most often expressed as a difference between men and women. B.C. has one of the highest gender pay gaps in Canada. According to Statistics Canada, in 2022, women in B.C. earned 17% less than men.
The Act places new requirements on employers aimed to close the gender pay gap in the province, namely it:
- Requires all employers to specify the expected salary or wage range for their public job postings.
- Prohibits all employers from seeking pay history information about a job applicant by any means, whether directly from the applicant or through a third party, unless the pay history information is publicly accessible.
- Prohibits all employers from adversely affecting, or threatening to adversely affect, employees who make inquiries to the employer about the employee’s pay, disclose their pay to co-workers or potential job applicants, make inquiries to the employer about a pay transparency report or information contained in a pay transparency report, ask the employer to comply with the employer’s obligations under the Act or make a report to the director in relation to the employer’s compliance with the employer’s obligations under the Act.
- Requires “reporting employers” to prepare and publish a “pay transparency report”.
The reporting requirements under the Act will be implemented on a staggered basis on Nov. 1 of each year, with private sector employer obligations being triggered on the basis of the number of the organizations' employees in British Columbia. The reporting obligation will come into effect as follows:
- The Government of British Columbia government and the six largest Crown corporations will be required to produce their first annual pay transparency reports by Nov. 1, 2023, which will be released prior to the year’s end.
- All employers with 1,000 or more employees must produce their first reports by Nov. 1, 2024.
- All employers with 300 or more employees must produce their first reports by Nov. 1, 2025.
- All employers with 50 or more employees must produce their first reports by Nov. 1, 2026.
The pay transparency report must be published on the reporting employers’ websites. Those reporting employers who do not have a website are required to post a copy of the pay transparency report in their workplace so that it is available to the employees and provide a copy to members of the public upon request.
As of the date of this article, there are currently no regulations accompanying the Act. The regulations will clarify the specific format and content requirements of pay information reports, among other points. An online reporting tool will be available to assist employers with the annual reports.
The provincial government has provided some guidance as to what the reports will look like, namely:
- Employers will be required to report the pay gap as the difference between hourly wages, overtime and/or bonuses received by men, women and non-binary people.
- They may also be asked to report the pay gap in quartiles (top 25% of earners, high 25%, mid 25% and lowest 25%).
- Real wage data, such as dollar amounts, will not be reported.
A Look Across Canada
In some respects, British Columbia is leading the way in this area. Similar legislation is currently in place in Prince Edward Island, where employers are required to specify the expected salary or wage range in public job postings, are prohibited from taking reprisal action against employees in relation to pay transparency, and are prohibited from questioning applicants about their pay history information; however, the legislation in Prince Edward Island does not impose any reporting requirements. Pay transparency legislation is “on the books” in Newfoundland and Labrador but not yet fully in force. Similar legislation has also been enacted in Ontario but has not yet been brought into force. Somewhat more complex requirements (including reporting obligations) are in effect in the federal jurisdiction as well.
Best Practices Around Implementing Pay Transparency
In British Columbia, here are some ways to get started in making the transition:
- Effective Immediately: ensure that recruitment practices adhere to the new rules that prohibit inquiries about pay history information.
- Effective Immediately: ensure that managers are aware of the new rules that prohibit any form of adverse treatment associated with pay transparency and/or an employee’s exercise of their rights under the Act.
- Effective November 1, 2023: ensure that recruitment practices associated with public job postings will specify the expected salary or wage range for the available position.
- Stay Tuned: determine which reporting requirement trigger point (if any) applies to your organization watch out for more information about the specific format and content requirements of pay information reports.